Fayette school board will hold second vote, public hearing on controversial tax increase

The Fayette school board will hold a second vote and a public hearing on a controversial resolution to increase the occupational license tax for schools, after the Kentucky Attorney General ruled this week that the board’s first vote was unlawful.

“The OLT resolution will be included on the June 23 board agenda. Additionally, there will be a public hearing to provide the community an additional opportunity to share feedback directly with the board, “ Fayette Superintendent Demetrus Liggins said.

School district spokesperson Dia Davidson Smith said Friday the date of the public hearing will be publicly announced and advertised in accordance with Kentucky law.

Kentucky Attorney General Russell Coleman ruled Wednesday that the school board failed to provide the legally required notice to the public before its May 27 meeting and vote to raise the tax.

Parents and other people in the community have expressed concerns about a lack of transparency in how the school board handled the vote. The backlash has been intense, with Kentucky Auditor Allison Ball saying Thursday she is considering a financial examination or audit of the school district.

According to the attorney general’s opinion, the school board’s 3-2 vote to ask the Fayette Fiscal Court to increase school tax rates on residents and businesses’ net income from 0.5% to 0.75% was improper because, under state law, school boards must notify the public and hold a formal hearing before voting on new or increased taxes.

“Tax and spend government is a danger to Kentucky’s future, especially when officials who should be accountable to Fayette County voters try to ignore the rules to raise taxes,” Coleman said. “If the Fayette County School Board members believe they need more of Kentuckians’ hard-earned dollars, they should clearly and publicly make their case before their own constituents.”

Fayette school district officials have argued the vote was legal and the tax increase was needed to cover a $16 million budget shortfall.

Given Coleman’s opinion, Fayette County Attorney Angela Evans advised the fiscal court not to vote on the increase Thursday, as the school board had asked, and the fiscal court followed her direction. Before that, fiscal court member Brian Miller, the District 1 County Commissioner, confirmed that he was a school district employee and would recuse himself from the vote if it occurred.

Davidson Smith said Friday the fiscal court’s decision not to vote was “per our request after the opinion of the AG was released.”

But Fayette County Clerk Susan Lamb told the Herald-Leader, “While the (Fayette County) Board of Education did withdraw their resolution following the release of the AG’s opinion, the fiscal court acted upon the AG’s opinion because it was received first.”

The Clerk of Fiscal Court was notified about the AG’s opinion at 10:21 am, Wednesday, June 4.

The Board of Education notified the Clerk of Fiscal Court about withdrawing their resolution following the release of the AG’s opinion at 11:02 am, Wednesday, June 4, Lamb said.

The current occupational license tax is expected to bring in $57 million to the district for the next fiscal year. Initially, the proposed increase in January 2026 would be $13 million to $16 million, with an estimated $27 million to $32 million annually when fully implemented, Fayette Deputy Superintendent Houston Barber has said.

The average Fayette County worker is paying $26 per month under the current Occupational License Tax Rate for schools. Under the increase, the average worker would be paying $39 per month, or $13 more. Annually, the average Fayette County worker pays $312. Under the increase, they would pay $468 per year.

At the May 27 meeting, board member Tyler Murphy, vice chair Amy Green and board member Penny Christian voted in favor of the tax increase. Board members Amanda Ferguson and Monica Mundy voted against it.

Sen. Amanda Mays Bledsoe, R-Lexington, first asked for an Attorney General’s opinion after hearing from her constituents.

“The FCPS board voted to increase the occupational tax without proper notification or advertisement that the school board was entertaining a discussion of a new levy, not to mention the time/date when it was going to be voted on by the board,” Bledsoe wrote in her request to the AG. There was no time for the public to properly engage the topic, nor plan to attend the meeting, she said.

“The School Board’s failure to provide the statutorily-required notice makes the vote unlawful and void,” the opinion said. “This validates what so many in our community, including myself, felt: Taxpayers were shut out of a huge decision about their own tax dollars,” Bledsoe said after Coleman’s announcement.

Bledsoe also asked Ball to conduct an audit. On Thursday, Ball said her office is considering an audit of the Fayette school district after hearing from parents and other constituents concerned about “the state of FCPS.”

Liggins has not yet commented on the possible state audit.

Parent Matthew Vied has said he would lead an effort to recall the tax increase if it were approved.

This story was originally published June 6, 2025 at 7:46 AM.